Joinder
1. Joinder
of Claims; Joinder of Parties by Plaintiff
Plant (P) v. Blazer
(D)
D loans P $2,520, payable at $105/month. P never pays.
P sues D under TILA. D
counterclaims P for unpaid balance. Trial
court rules for P on TILA claim, but also rules for D on its counterclaim. Trial court offsets the award. Both appeal.
Is joinder of a state debt counterclaim to a TILA action compulsory or
permissive?
A CC is compulsory if it arises out of the transaction or
occurrence of P's claim; (four tests).
P says it should be permissive b/c:
debt collection in TILA claims is infringement on states rights; TILA is
undermined if debtors are faced w/ CCs in excess of possible recovery;
entangling factual and legal questions unrelated to TILA claim; federal court
workload increases; class actions destroyed by individual questions; judicial
economy if debtor wants jury trial;
D says it should be compulsory b/c:
judicial economy by presenting a single set of facts; complete relief to
involuntarily sued Defendant; even-handed treatment
Court says: Rule 13a req’s compulsory
CC if same transaction/occurrence.
Logical relation test.
Rule 13 counterclaims:
Permissive (D has the option to
bring it now or later) (must have subject matter jd to bring it, must be able
to stand on its own jdxal legs), and
Compulsory (D must bring it now, or
else the claim is lost to Res Judicata) (court always has smj over compulsory).
Mosley (P/W) v. GM (D)
Ps file class action against Ds. District court severed the Ps and ordered that
each P bring his own complaint. Ps
interlocutory appeal. When can Ps join
w/ other Ps?
Ps say: convenience; same transaction(s)/occurrence(s), same
question of law or fact (i.e. question of D's discrimination).
D says: no common transaction/occurrence/question of law or
fact.
Court says: 2 part test: 1) transaction/occurrence (logical
relationship test); 2) same question of law or fact.
2. Joinder
of Parties by Defendants
Price (P) v. CTB (D)
P sues D for faulty construction. D filed 3rd party complaint against ITW. ITW says it was improperly impleaded under
rule 14a.
D can implead anyone not a party to the action if the 3rd
party's liability is in some way dependent upon the outcome of the original
action.
D cannot implead when the claim is based upon a separate and
independent claim.
D can implead another D if the other D is derivatively
liable (like contribution or indemnification).
Kroger v. Omaha
|
P/IA
|
D/NB/W
|
P sued OPPD for wrongful death. P's decedent was employed by Paxton steel in
Iowa. Decedent walked alongside a crane
owned by Owen Equip./erection and leased by Paxton. The power lines were sold by OPPD to Paxton
and OPPD sold electricity and made repairs to Paxton. P sues D in federal court for diversity
jdx. D impleads Owen (IA), destroying
the diversity. P amends the complaint to
add Owen.
Owen Equipment (W) v.
Kroger
1332 requires complete diversity on both sides of the
v.
Owen says: no complete div., no federal jdx.
Kroger says: federal court has ancillary jdx b/c
3. Compulsory
Joinder of Parties; Intervention
Temple, P/W,
Miss. v. Synthes, D, PN
P sued D (manufacturer) in federal court for div.
P sued the hospital and dr. (Louisiana) in state court
Louisiana.
D moved to d/s in federal court for failure to join nec.
Parties under R. 19. Court ordered P to
join hospital and dr. P did not, case
d/sed.
Helzberg (P/W) v.
Valley West (D)
Synopsis of Rule of Law. A party not within the personal
jurisdiction of the presiding federal district court can only be joined as a
third-party defendant under Federal Rule of Civil Procedure (FRCP) Rule 19(b)
if it is indispensable to the litigation, such that the party’s absence will be
prejudicial either to that party or the previously named defendant.
P and D enter lease K that prohibits other full line jewelry
stores from leasing.
D leases to Lord's, a full line jewelry store.
P sues D
P gets preliminary injunction from District Court
D moves to d/s for failure to join an indespensable party
(Lord's), court denies it
D appeals
P: Lord's is not
indispenable party, injunction will not prejudice Lord's, none of its
duties/obligations are being decided in this suit. Injunction will not prejudice D either,
Lord's has not brought suit against D, no proof that another court would
interpret the K differently.
Court gave Lord's the option to intervene, did not do so.
D: Lord's is indispensable.
Injunction will prejudice Lord's.
If Lord's brings suit elsewhere, I may be under inconsistent obligations
Natural Resources
Defense (P) v. USNRC (D)
American Mining Congress and Kerr McGee Nuclear Corporation
tried to intervene as a matter of right or on a permissive basis.
D gives licenses for the operation of uranium mills. D also gives states the right to issue
licenses. New Mexico gave United
Nuclear a license, and P filed suit to enjoin D from issuing it. United Nuclear's motion to intervene was
granted. Other motions by similar
potential license recipients to intervene were denied, b/c their interests were
adequately represented by United Nuclear.
They appeal.
3 req's:
- does
movant have an interest related to the property or transaction?
Court says: yes, they operate mills in NM and are waiting
for renewal of licenses for others.
- Would
the disposition of the action impair or impede their ability to protect
it?
Yes, this is a matter of first impression, so a decision
would be stare decisis and effect them also.
- Is there
interest adequately represented by existing parties?
No, United Nuclear already has its license, it may settle
for a prospective requirement.
Martin v. Wilks
Seven black individuals filed class actions against the City
and the Board about public employee hiring practices.
Got a consent decree
Seven white firefighters filed a complaint enjoining the
consent decrees, denied by DC
Other whites brought a complaint against the city and the
board too. Defendants moved d/s that the
complaint was an impermissible collateral attack on the consent decrees.
Granted.
On appeal at 11th circuit, reversed that whites were not a
party or privy to the consent decree
Discovery
4. Introduction;
Stages of Discovery
Davis (P/W) v. Precoat
Metals (D)
Ps want the discrimination complaints made against the D by
nonclerical/adminstriatve ees.
D's say:
that the request is overbroad b/c P's want all accounts of discriminatory
actions, irrelevant to the cause of action, the burden of the discovery
outweighs the benefit
P's say:
that the request is sufficiently narrowly tailored to the specific claims of
the case and to the Chicago employees only, is relevant to the CoA to establish
pretext.
5. Limits on
Discovery: Relevance & Privacy
Steffan (P/W) v.
Cheney
P sues D claiming he was constructively discharged but
mainly the constitutionality of don’t ask don’t tell when he claimed he was
homosexual. At deposition, D asks P
about homosexual conduct and P refuses to answer on 5th amdmnt
selfincrimination and irrelevant grounds.
District court dismissed for failure to comply w/ the discovery.
D says: question of
conduct is important to determine whether P is fit for
reinstatement.
P says: this CoA is solely about being discharged for words
(claiming to be homosexual) not for misconduct.
Stalnaker (P/W) v.
Kmart
P sued for sexual harassment by D's employee Mr.
Graves. P sought to depose 4 other
employees. D moved for a protective order barring the
depositions.
D says: that the depositions are invasion of privacy which
outweighs the value, and that the voluntary romatnic/sexual activities of the
deponents are irrelevant. Evidence Rule
412 protects alleged victims from depositions about their sexual live.
P says: that the witnesses may have information about being
sexually harassed by Graves, or about voluntary activities w/ him. The info may lead to discovery of admissible
evidence. P would agree to a protective
order preventing dissmeination of the info to 3rd parties. Rule 412 only applies to victims, not witnesses.
Court says: inquiry into general sexual activities is
prohibited. Inquiry into sexual activity
w/ Graves is relevant, though. The info
is not to be disclosed outside this litigation.
6. Limits on
Discovery: Privilege and Work Product
Hickman (P) v. Taylor
(D/W)
P seeks private statements from witnesses obtained by D.
D refuses to provide them.
District court orders D to provide them, D does not.
The matter goes to the SCT.
The matter goes to the SCT.
Sup.Court says the statements are protected work product.
P says: D is req'd to provide all facts that he knows. D can't allege atty-client privilege (does
not apply to witnesses). Necessity
(can't find witnesses)
D says: P's request is in bad faith,
annoy/embarrass/oppress. The witnesses
are well known and available to P. The
steamboat inspector's record is available to P.
Protected work product is interviews, statements, memoranda,
correspondences, briefs, mental impressions, personal beliefes,
7. Experts;
Preserving Evidence
Thompson (P) v.
Haskell co (D/W)
P was terminated on 6/5/92
On 6/15/92, P's first counsel got P a psychological
examination.
P sued D for sexual harassment on 11/23/93.
D seeks the psychological records in P's Doctor's
possession.
P moves for protective order.
P says: Rule 26b4D,
facts/opinions of experts not expected to be called as a witness are not
discoverable (absent exceptional circumstances).
D says: This is an
exceptional circumstance, P's mental state ten days after termination is highly
probative/important. No other such
report was prepared, thus can't obtain the info by other means.
Chiquita Int'l (P/W) v. Bolero Reefer (D)
P and D K for shipment of bananas
D fails to ship a portion of the bananas due to alleged
malfunctions of the loading crane.
When D's ship arrived, P requested that Mr. Winer examine
the vessel and loading gear.
D seeks to compel discovery of Mr. Winer
P says: He is a
non-testifying expert and not discoverable.
Not exceptional b/c D could have sent its own expert to survey the
ship. D's employees could have surveyed the
loading gear during the 3 week voyage.
Can't see the file b/c rule 26b4b applies to docs as well. Can't see any docs that contain Winer's
observations/opinions.
D says: He is a fact
witness; this is an exceptional circumstance b/c he was the only person to
survey the ship shortly after it docked.
I should at least be able to see docs in the file provided to Mr. Winer
by others.
(court says docs provided to Winer by others are
discoverable)
Silvestri (P) v. GM
(D/W)
P was driving his landlady's GM car while drunk and
speeding.
P hit a pole and the airbag did not deploy.
P did not notify GM of the accident until ~3 years later
when the lawsuit was filed.
District court d/sed the suit for spoliation of evidence, P
appeals
P says: not
responsible for preserving the evidence b/c I don't own it. Dismissal is unduly harsh sanction, usually
only in cases of bad faith. District ct
could have deemed certain facts established or presumptions applied to burden
of proof.
D says: duty to
preserve evidence arises before litigation when a party reasonably knows that
it may be relevant; if he does not own it, he must notify the opposing party of
access to it and its possible destruction.
Even though P did not own the car, he clearly had access to it for 2-3
months b/c his atty and experts looked at it; they anticipated litigation so
this was enough time to notify GM.
Dismissal is proper, prejudice to D is so extraordinary that D can't
defend itself.
8. Discovery
Abuse
Zubulake (P) v. UBS Warburg LLP (D)
P sued D for gender discrimination, retalliation. P requested discovery of e-mail backup
tapes. D orally instructed employees to
stop recycling backup tapes. Certain
tapes are missing. Three tapes of date
created after April 2001 were lost, which should have been retained for 3 years
P seeks sanctions for spoliation of evidence that, 1) D pay for restoring the
rest of the tapes; 2) adverse inference instruction re missing tapes; 3) that D
pay for re-depositions regarding new e-mails.
P says: D had a duty
to preserve, D had notice that the tapes were relevant to litigation. Duty began 8/16/01 when EEOC charge filed,
but maybe in April 01 b/c some emails were titled atty - client privilege. D should have suspended its tape-recycling
when it anticipated litigation, should have protected tapes of key players'
emails.
D says: I had no duty
to preserve.
Adverse inference
P says: 1) D had a
duty to preserve; 2) D had a culpable
state of mind b/c it was negligent to allow the tapes to be lost, but willful
spoliation is enough; 3) tapes are relevant
D says: 3) the 68 e-mails which P provided to court and said
were most representative of the discrimination claim do not support the claim,
thus court should infer that the lost e-mails were not relevant either.
Court says no to payment for restoring; no to adverse
inference; yes to payment for redepositions
Resolution Without Trial
9. Default
and Dismissal
Peralta (D/W) v.
Heights Med (P)
P sued D for unpaid bill incurred by D's employee. P personally served the lawsuit after 90
days, making it untimely. P got a
default judgment. D moved to set it
aside, D conceded that he had no meritorious defense though. Trial for P.
P says: no meritorious defense. if the judgment is set aside, the same
judgement will be entered, which is a waste of time.
D says: deprived of due process, notice. I would have impleaded the ee, worked out a
settlement, or paid the debt. I would
have sold the property and gotten a better price for it than the constable got.
10. Summary
Judgment
Celotex v. Catrett
P sued D for asbestos.
D mtn SJ, that no evidence for P's claim. P produced evidence. D objects that evidence is hearsay. Trial agrees, SJ. AppCt says rule 56 req's SJ movant to show
evidence in his favor, D had no evidence, rev'd. SCT cert.
Bias v. Advantage
D told P that he took out a life ins policy for him. P dies of coke intox, sues
The Erie Problem
11. Introduction
to the Erie Problem
Swift v. Tyson
Caselaw is just evidence of what the state law is; rules of
decisions are only legislature-enacted statutes. Fed Courts will develop their own common
law. J.Story believes that he will
create a federal commonlaw to be followed by all statecourt judges.
Erie v. Tompkins
P wants to be in federal court for more favorable federal
negligence standard. District court
overrules Swift. Appeals Court reverses District court. SupCt looks at taxi cab case, company
incorporates in another state so that they could sue in federal court under
diversity and enforce their contract (KY state court does not allow
monopolies). SupCt says Swift is
overruled, courts must accept state common law and statutes.
12. Interpreting
and Deconstitutionalizing Erie
Guaranty Trust v. York
If state SOL, case barred; if federal court practice, case not
barred. Held: if state law claim would
be barred by SOL in state court, then same for federal court.
Lower court says: SOL does not speak to liability, only to
deadline; thus, SOL is not substance, but process. SCT says substance/process labels don't
matter; reaching the same result that would have been reached in state court is
what matters. Outcome-determinativeness,
outcome of the litigation in federal court should be substantially the same, so
far as the legal rules determine the outcomes of a litigation, as it would be
if tried in the State court.
Problem:
Every procedural rule can, at some point, become
outcome-determinative
Federal power over procedure lessens
Byrd v. Blue ridge
Swift to Erie (federal preeminence); Erie to Byrd (state preeminence). P
ind. Contractor files tort, D says that P can only recover under worker's comp.
statute. Testimony is ambiguous as to
whether P is IC or ee.
Issue: whether employment status can be decided by judge (SC
law) or by a jury (federal law). Which one
governs in federal diversity case?
Holding: Court says federal law wins.
Reasoning:
First, must respect state substantive law and "rights
and obligations bound up with it" (??).
Second, even if not "bound up with state-created
rights" (i.e. even if the state rule is one of "form and mode"),
ask whether applying the state rule would dictate the result of the case. (i.e.
outcome-determinative test).
If applying the state rule would dictate the result then
balance the interest (the policy) of uniform enforcement against the federal
interest in having an independent system for administering justice for
litigants.
Court says that 7th amendment generally favors jury
determination of fact
Balance of state law with federal policy of uniform
enforcement.
Clearly substantive (negligence i.e.)--hazy middle (Byrd
i.e.)--clearly procedural (paper size i.e.)
Hanna v. Plumer
Holding: if the Rule really regulates procedure, then
it trumps the state rule.
Diversity case in MA.
MA negligence (substantive) law applies.
But, Do we import MA service of process rule or use FRCP? Rule 4 says leaving it w/ competent adult is
enough. MA req's personal service on
executor. If MA rule applies, then
service ineffectual and case d/sed; outcome determinative.
Rule 4 trumps, why?
The Rules Enabling Act, 28usc2072 - gave SCT authority to
create FRCP. However, can't abridge,
enlarge, or modify any substantive right.
What state laws are substance and what are procedure.
An REA question determines whether a federal rule is invalid
(substance) or valid (procedural)
How to determine if a Rule complies w/ REA Procedure is the
judicial process for enforcing rights and duties recognized by substantive law;
If it alters substance then no.
p.
241, 3rd para.
Even if no Rule existed, the MA law would not apply b/c Erie
stopped the practice of forum shopping.
Plaintiffs probably won't forum shop based on a SOP rule.
13. Deconstitutionalizing
Erie cont’d
Shady Grove v.
Allstate
Damage caps, etc. are substantive law. D wants deference to the state court to avoid
a conflict.
Procedural? 1 $5mil case or many $500 cases?
Dissent
Defer to states and don't find a conflict unless absolutely
necessary.
Finding a direct conflict often dictates the result
Stevens (Byrd/boundup test) and Scalia (Sibbach test)
Ginsburg
Judges, Juries, and Trials
14. The
Integrity of the Judge and the Integrity of the Jury
In re Boston's
Children first
Judge says: was explaining procedures of the court
Ps say: saying that this case is "more complex"
than Mack is commenting on the merits of a pending motion.
Thompson v. Altheimer
P sues for discrimination.
In federal system, judge generally questions jurors to discover
bias. One juror says her judgment will
be clouded. P asks she be struck
"for cause" (juror is biased).
Parties not limited in for cause strikes (only limited by whether or not
judge agrees). When the appeals court
finds that a juror should have been stricken for cause, there is no investigation
into whether it was a harmless error; rather, it is immediately remanded for a
new trial (a biased jury is never a
harmless error). P had no more
peremptories to strike Leiter (D did not use peremptories on Leiter). Appeals Court said that trial did not push
Leiter hard enough to say "I will not be biased" (probably just a
public relations guise).
Competition b/w obtaining unbiased jury and an accurate
cross-section of the community. Judge's,
D's, and P's competing interests. Judge
wants to fill the jury box quickly; might not press jurors very hard.
15. Controlling
Juries Pre-Verdict
Reid v. SP, LA, SL RR
P rents land from D.
P's cow killed by D's train. P
claims D negligently maintained fence.
There was a hole in the fence (D's responsibility); but, the gate was
open (P's responsibility). Jury finds in
favor of P. Court says it was equally
likely that it was either side's fault; overturned the verdict and ruled for
D. When to prohibit the jury from
deciding the case and saying that there is only one rational way to decide the
case. Judgment Notwithstanding the
Verdict (i.e. judgment as a matter of law).
PN RR v. Chamberlain
Whether a defendant is entitled to a directed verdict where
the plaintiff with the burden of proof alleges facts supporting two
inconsistent theories, only one of which would impose liability against the
defendant.
16. Controlling
Juries Post-Verdict
Lind v. Schenly
P says K, D says no K.
Someone makes a mtn for a new trial after the verdict. Standard for ordering new trial is
"against the great weight of the evidence." Judge has wide discretion to weigh the
credibility of the evidence (as opposed to JMLs and JNOVs).
Peterson v. Wilson
Limits to the control over juries. D mtn JML denied. P wins. D moves JNOV, and
alternatively mtn for new trial. Both
denied. Court orders new trial sua
sponte. Court did not grant JML or JNOV
b/c a reasonable jury could find for the P.
Judge was in error because he ordered a new trial, not because the
verdict was against the great weight of the evidence, but because the judge
talked with the jurors without the lawyers present and determined they
disregarded his instructions during their deliberation. Ex parte communications. P cannot appeal court's order for a new
trial, only option is to move for reconsideration and/or go through another
trial.
New trial cannot be ordered just because jury did not follow
instructions, even if they did so intentionally. Rules of evidence prohibit hearing testimony
of jurors regarding their failure to follow instructions.
Policy for and against inquiring into jury
deliberations. Don't want to harass
jurors to overturn a past verdict, want frank discussions in the jury room.
Appeal
17. Who May
Appeal? When May A Decision Be Reviewed?
Wetzel
Ps sue for discrimination for injunction, atty's fee,
damages. Court says D liable, D moves
reconsideration (denied). District court
does not reach question of relief and sends parties to appeals court on the
question of liability. AppCt rules, D
appeals to SCT. SCT says that it will
not hear the partial SJ liability b/c not a final judgment. Sec. 1291 on appellate jdx. SCT says.
Appellate jdx lies only after the trial court has made a finding on
relief.
Reasoning: piecemeal appeals are inefficient, deference to
the trial court, cases settle.
Efficiency v. justice (sometimes interlocutory appeal is the only option
a party has).
Ways to get around FJR:
Injunctions can be appealed immediately.
Multiple claims w/ multiple parties where one of the claims
has been given a final judgment; can be
appealed as a package.
Certification - 1292(b), trial court certifies to AppCt that
the interlocutory appeal is founded on a good reason. AppCt has discretion to hear the appeal, has
ten days to decide whether or not to hear it.
18. Exceptions
to the Final Judgment Rule; Scope of Review
Lauro lines v. Chasser
How to get an
appeal heard.
Exceptions to FJR:
Judge-made doctrine
Collateral order
doctrine
Ps sue in
SDNY. D has forum selection clause for
Naples, Italy. Ps say clause was
unreasonable. D appeals court's
order. Is the denial of the mtn d/s a
final judgment rule? No. however, collateral order exception. Collateral order doctrine: allows an
interlocutory appeal to be heard on the merits.
COD, the trial
court's order:
Conclusively
determine the disputed Q
Resolve an
important issue that is separate from the merits of the action
Right is important
when sufficiently important to overcome policies militating against
interlocutaory appeals
Must be effectively
unreviewable on final appeal
When a right, the
legal and practical value of which would be destroyed if not vindicated before
trial.
Held: the choice of
forum does not trump our policies against piecemeal appeals.
However, COD dying. The Mohawk case, when orders to reveal
articles allegedly protected by atty-client privilege are not appealable
interlocutory, the harm is done and can't be undone. Rules Enabling Act, congress lets the federal
courts make rules.
Anderson v. Bessemer City
Gender
discrimination case. At bench trial,
Judge found in favor of P that hiring of man over P was discriminatory. When a judge decides something, judge has to
put findings of fact and conclusions of law in writing, generally in an opinion. Fact findings and conclusions of law are
numbered. Judge found four findings of
fact:
- P more qualified than the man hired for
the job.
- Male committee members were biased b/c
testimony in court of a member.
- P was asked whether her H approved of
the job, other applicants were not
- D's justification was pretextual, that
man hired for the job had better education was pretextual b/c committee
valued experience (P) over education (man).
Standard of
appellate review for questions...
of law: de novo;
of fact: clearly
erroneous (reviewing court left w/ the definite and firm conviction that a
mistake has been committed).
Clearly erroneous
continuum: 1-no evidentiary basis -2-3-4-5-toss up-6-7-8-9-10-Strong
evidentiary basis.
If no evidentiary
basis for the finding of fact, then clearly erroneous.
Appeals court looks
for something in the hazy middle to decide on.
Clearly erroneous
analogous to "great weight of the evidence" standard.
The standard that
"reasonable people could disagree" as to the finding of fact is not
strict enough (in that it should defer to the trial court if reasonable people
could disagree).
Theme of deference
to the trial court; trial court is the fact finder, appellate court is the law
finder.
Harnden v. Jayco
D moves SJ, rule
56, that expert's opinion absolves D of liability. D says RV expert says no substantial defect
w/ P's RV. P needs an expert to testify
to the contrary; however, P says that the testimony shouldn't be considered at
SJ b/c not in admissible form (affidavit).
D volunteers to fix the problem, but trial court says that the info is
sufficient and SJ granted. At appeal,
crt assumes that P is right about form of evidence being in error, but that the
error did not harm P b/c D would just put the evidence in the right form below
and proceed. The expert is the key piece
of evidence for D. The evidence might
change if sworn under oath (affidavit) or less formal (form used here). When the trial court messes up evidence
admission, it is always harmful error.
Respect for Judgments
19. Claim
Preclusion: Efficiency and Consistency
Frier v. Vandalia
Claim preclusion/res judicata. What is the same claim? P brings replevin action in state court,
ruled in favor of city. P brings 1983
action in federal court that Procedural Due Process was violated b/c P not
provided a post-deprivation hearing. P
could legally be towed, but get recovery for violation of PDP even if the tows
were legal. Federal court dismisses P's
claim that P has no claim on which relief can be granted NOT that the claim was
precluded. Federal Appeals Court affirms
but on claim preclusion, that state court replevin action precludes the PDP
claim. Lesson: bring all claims or else
it may be waived.
Even if P had won his replevin action in state court, his
PDP claim in federal court would still be precluded.
Whose law of claim preclusion is applied? The law of the court who rendered the first
judgment. IL's law of claim preclusion
applies, "common core of operative facts."
Two options:
Majority
Second claim arises out of the same transaction or
occurrence
Efficiency purposes is the rationale for this rule. Courts often justify decisions on the
rationale for the CP rule rather than the rule itself.
Concurrence
Same evidence is used for both claims; claim is precluded on
the merits
Frier
Different claims that are still precluded. Res Judicata claims not decided on the
merits, a meritorious claim that has been precluded loses.
Frier court adopted the test that the majority of states
use:
The Transaction test.
Are the facts related in time, space, origin, motivation? Do they claims together form a convenient
trial unit?
Rationale for CP: efficiency. All substantially related claims should be
brought at once so as not to burden the court and the parties. A claim not brought in a case about the same
transaction is precluded.
20. Claim
Preclusion Between the Same Parties, After a Final Judgment, and After A Final
Judgment on the Merits
Martino (P) v. McDonalds (D)
K provides that P's family would not open a competing
franchise. D sued P in federal court for
violating the K, D gets consent decree (a settlement approved by the court that
acts as a judgment) that P would sell his McDonalds franchise. P then sues D for anti-trust in federal
court.
D says P's suit is barred by:
- Rule
13: Compulsory Counterclaims must be brought or else it is lost. CC's must be included in a pleading
(i.e. an answer). However, P never
filed a pleading because the case settled; thus, 13 doesn't apply. CC's provide efficiency to the system. Party autonomy for Ds.
- Common
law CP/Res Judicata: P's
(counter)claim barred.
The claim is precluded b/c D relied on the consent decree,
even though it is a meritorious claim. P
does not get to have his meritorious claim heard.
Another rationale for CP: avoiding inconsistent decisions.
Searle
Divorce (H v. W) gives house to W. After divorce, Son's partnership claims an
interest in the house.
Sons say the partnership was not a party to the
divorce. That interests in land do not
succeed to agents. That the merits do
not matter, only that the claim should be heard. Rationale for CP: fairness to get your claim
heard.
W says the partnership was in privity with H. That the claim is not meritorious (the
partnership is not legally formed, etc.).
Rationale: efficiency, fairness to D to not have to go through another
suit.
Gargallo v. Merrill
Lynch
P sued for collection of debt by D. P CCs that D caused the losses. P disobeys discovery orders, CC d/sed. P sues in federal district court, same
transaction, same claim - federal securities law. Court looks at OH law to see whether the
claim is precluded. Dismissal of CC for
failing to comply w/ discovery gets claim preclusive effect in OH; however, OH
doesn't have jdx to hear federal securities law claims.
2 situations when CP doesn't apply:
The first court didn't have personal jdx to hear the claim,
d/sal for no personal jdx is not a final judgment (unless waived)
If first court didn't have SMJ, then d/sal for no SMJ not a
FJ
Point: First court must have had proper SMJ jdx to hear the
claim in order to bar it CP in second court.
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